Mr. James McDonald reports

KOOTENAY SILVER ANNOUNCES $4 MILLION PRIVATE PLACEMENT FINANCING OF UNITS

Kootenay Silver Inc. has entered into an agreement with Research Capital Corp., as co-lead agent and sole bookrunner, and together with Red Cloud Securities Inc. as co-lead agent, on behalf of a syndicate of agents, including Canaccord Genuity Corp., in connection with a best efforts private placement of units of the company at a price of 10 cents per unit for gross proceeds of up to $4-million.

Each unit will comprise one common share of the company and one common share purchase warrant. Each warrant shall be exercisable to acquire one common share at a price of 14 cents per warrant share for a period of 36 months from the closing of the offering.

The company will grant the agents an option to increase the size of the offering by up to 15 per cent in units by giving written notice of the exercise of the agents' option, or a part thereof, to the company at any time prior to closing.

The company intends to use the net proceeds from the offering for working capital requirements and other general corporate purposes.

The securities to be issued under the offering will be offered by way of private placement in each of the provinces of Canada and such other jurisdictions as may be determined by the company, in each case pursuant to applicable exemptions from the prospectus requirements under applicable securities laws.

The offering is scheduled to close on or about the week of May 23, 2023, or such date as agreed upon between the company and the agents, and is subject to certain conditions, including, but not limited to, the receipt of all necessary approvals, including the approval of the exchange. The units to be issued under the offering will have a hold period of four months and one day from closing.

In connection with the offering, the agents will receive an aggregate cash fee equal to 6.0 per cent of the gross proceeds from the offering, including in respect of any exercise of the agents' option (subject to a reduced fee of 3.0 per cent for sales to president's list investors). In addition, the company will grant the agents, on date of closing, non-transferable compensation warrants equal to 6.0 per cent of the total number of units sold under the offering, including in respect of any exercise of the agents' option (subject to a reduced fee of 3.0 per cent for sales to president's list investors). Each compensation warrant will entitle the holder thereof to purchase one unit at an exercise price per compensation warrant unit equal to the offering price for a period of 36 months following the closing.

About Kootenay Silver Inc.

Kootenay is an exploration company actively engaged in the discovery and development of mineral projects in the Sierra Madre region of Mexico. Supported by one of the largest junior portfolios of silver assets in Mexico, Kootenay continues to provide its shareholders with significant leverage to silver prices. The company remains focused on the expansion of its current silver resources, new discoveries and the near-term economic development of its priority silver projects located in prolific mining districts in Sonora state and Chihuahua state, Mexico, respectively.

We seek Safe Harbor.